As widely expected, the Federal Reserve announced it will hold interest rates steady following the FOMC’s meeting on September 19-20. However, it predicted that there could be an additional 25 basis point rate hike later this year.
In a high-interest rate environment, most sectors usually struggle with a high cost of capital. However, the financial sector typically thrives in a high interest-rate environment because its revenues correlate positively to interest rates. Therefore, it could be wise to buy fundamentally strong consumer financial stocks OneMain Holdings, Inc. (OMF), FirstCash Holdings, Inc. (FCFS), and Regional Management Corp. (RM).
